بسم الله الرحمن الرحيم
السلام عليكم ورحمه الله
هده هي الايجابه عي اسئله استطلاع الرائي من كتاب trading in the zone.
- SURVEY ANSWERS -
1. Making money as a trader is primarily a function of analysis.
The answer that is consistent with a trader's "mind set" is
disagree.
It's natural to think that the more you learn about the markets the
better the trader you will be. And there is some truth to this, but only
after you've acquired all of the appropriate mental skills.
There are three broad categories of skills you will need to acquire to
achieve consistent results as a trader: a) Analysis - being able to
objectively identify an edge; b) execution - being able to do exactly
what you need to do without fear, hesitation, or any other negative
encumbrances; and, 3) Accumulation - allowing your account balance to
grow without the potential for self-sabotage.
Analysis is the easiest part of this process to learn. And as a result,
most people mistakenly assume that trading is also easy. The problem
here is, analysis and trading are the not the same things. No matter what
your analysis says, the only way you can transform that analysis into
profits is if you can execute your trades properly. Trading is a function of
proper execution.
To execute your trades properly you need a strong sense of
confidence. Meaning a distinct lack of fear. Understanding the markets
(analysis) will not give you this sense of confidence if you haven't
learned how to think in probabilities first. In fact, you will find just the
opposite is true. If you haven't learned how to think in probabilities, the
better the analyst you are the less successful you will be as a trader. To
execute your trades properly you have to get to the point where you are
completely comfortable operating in a state of "not having to know" what
will happen next.
When you've mastered the skill of being able to maintain your
sense of confidence, while simultaneously "not having to know," you
will be in the best state of mind to perceive what the market is making
available from it's perspective and also execute your trades flawlessly.
When you get to the point in your development where you can execute
trades flawlessly is when the full potential of your analytical abilities
will come to bear on your bottom line results.
To accumulate money over time, requires a distinct lack of
potential for self-sabotage. Self-sabotage is a function of not
completely believing that we deserve the money or success. More of
better analysis will not in any way compensate or neutralize the
negative effects of these internal forces.
The bottom line is, analysis is only one very small step in the
process of becoming a consistently successful trader.
2. I often find myself thinking there must be a way to trade without
having to take a loss.
The answer that is consistent with a trader's "mind set" is disagree.
If you agreed with this statement it indicates that you have not
accepted one of the most fundamental characteristics of trading. Losses or
losing trades are a natural, to be expected consequent of trading. To a
professional trader, taking a loss has the same significance as having to
pay utility bills if you owned a restaurant. Paying the utility bills is a
business expense that cannot be avoided. If you want to stay in business.
By the same token, you won't stay in the business of trading very long if
you do it from the perspective of trying to avoid losses.
The only way you could trade without having to take a loss is if
you had some way of knowing "for sure" what was going to happen
next. Remember, it only takes one trader somewhere in the world to
negate the positive outcome of any type of edge. The beauty of
technical analysis is you don't have to know what is going to happen
next to make money. In other words, you are not responsible for
predicting market direction.
However, you are responsible for deciding in advance of putting on
a trade what the market has to do to tell you the trade isn't working. When
you can truly accept the inevitability of losing you will be in the best state
of mind to keep those losses small and manageable. Which, in turn will
free your mind of negative encumbrances so that you're available to
take the next trade.
3. Do you ever find yourself planning trades you never execute,
and executing trades you never planned?
The answer that is consistent with a trader's "mind set" is disagree.
I've worked with countless traders who would spend hours doing
their market analysis, planning their trades for the next day, and
instead of putting on the trades they planned, they did something
else. The trades they did put on were usually an idea of a friend or a tip
from their broker. I probably don't have to tell you that the trades they
originally planned, but did not act upon, were the big winners of the
day.
The problem here is, when we act on our own ideas, we are
putting our creative abilities on the line and we get instant feedback on
how well our ideas work. Furthermore, it's very difficult to rationalize
away any unsatisfactory results. Whereas, when we take an unplanned,
random trade, it's much easier to shift the responsibility by blaming the
friend or broker for their bad ides.
Unplanned, random trades will obviously produce random results
where you never really learn what works and what doesn't. If your
objective is to create consistent results, then you have to start from the
premise that no matter what the outcome you are responsible for what
you end up with. As hard as that may be to hear, it can't be any other
way if you consider that with trading nothing happens until you decide to
put on a trade, the trade lasts as long as you want, and it doesn't end until
you decide to stop. All of these beginnings, middles, and endings are the
result of your interpretation of the information available and how you
choose to act on those interpretations.
Yes, you are responsible for making all of these decisions that
result in an outcome. But there is one thing you are not responsible for.
You are not responsible for what the market does or doesn't do. Which
means you are not responsible for predicting it's direction. As a
technical trader you are only responsible for making sure you are in the
best state of mind to objectively recognize if your edge is present and to
flawlessly follow your rules for getting into and out of that trade.
Creating a set of rules and following those rules is your job. You'll find
that job will go much easier when you stop trying to predict what the
market will do. If you don't have to take responsibility for the market,
then there's really nothing to avoid. Which means you don't have to
avoid executing the trades you planned.
4. I have trouble getting out of a losing trade.
The answer that is consistent with a traders "mind set" is disagree.
When you've absolutely and unequivocally convinced yourself
that: a.) the outcome to every edge is a unique occurrence, b.) there's a
random distribution between wins and losses on any given set of
criteria that define an edge, and c.) it only takes one trader somewhere
in the world to negate the positive outcome of your edge, you won't
have any problem getting out of a losing trade.
However, there are other reasons why someone might have a
problem getting out of a losing trade even if they believe the principles
stated above. They could have either a conscious or subconscious need
or desire to inflict themselves or someone else in their lives with
emotional pain.
5. If I were to thoroughly analyze my trading results, I would
find that my average losing trade is much bigger than my
average winning trade.
The answer that is consistent with a traders "mind set" is disagree.
If you agreed with this statement, it is an indication that you
either don't have a very good edge or you are hanging on to losing
trades and getting out of your winning trades too soon. Any technical
indicator that you choose to define your edge should generate a
minimum of a 3:1 risk to reward ratio. Meaning, the potential for profit
should be at least three times the dollar value of what you need to risk to
find out if the trade is going to work.
If you back or forward-test your edge and find that it does
produce something close to a 3:1 risk to reward ratio, but your bottom
line results do not reflect this, then it's a very good indication that you
haven't trained your mind to think in probabilities.
6. There is always a cost associated with finding out what the
market may do next.
The answer that is consistent with a traders "mind set" is agree.
This is just another way of saying that every trade has a probable
outcome. And, as a result, the possibility exists that the trade won't ever
be profitable or profitable within risk parameters that you can accept or
tolerate. Therefore, by definition, with every trade there is a cost to find
out if it is going to work.
7. It only takes one trader somewhere in the world to negate the
positive outcome of any particular trade.
The answer that is consistent with a traders "mind set" is agree.
I have a perfect example to illustrate this point.
Several years ago, a trader came to me for help. He was an
excellent market analyst, in fact one of the best I've ever met. But
after years of frustration where he lost all of his money and lot of
other people's money trying, he was finally ready to admit that as a
trader, he left lot to be desired - to put it mildly.
After talking to him for a while, I found he had a number of
serious mental obstacles preventing him from being successful. One
of the most troublesome was that he was a know-it-all and extremely
arrogant about it. This 'know-it-all' perspective made it impossible
for him to achieve the degree to mental flexibility required to trade
effectively, regardless of how good an analyst he was. But he was so
desperate for money and help that he was willing to consider
anything at that point.
So the first suggestion I made was that instead of looking for
another investor to back what would ultimately be another failed
attempt at trading, he would be better off getting a job doing
something he was legitimately good at. He could be paid a steady
income while working through his problems and at the same time
provide someone with a worthwhile service. So he took my advice
and immediately found a position as a technical analyst with a
fairly substantial brokerage house/clearing firm in Chicago.
The semi-retired Chairman of the Board the this brokerage firm
was an old time trader who had nearly 40 years of experience in the
grain pits at the Chicago Board Of Trade. He didn't know much about
technical analysis because he never needed it to make money on the
trading floor. But he didn't trade on the floor any longer and found the
transition to trading from a screen difficult and even somewhat
mysterious. So he asked the firm's newly-acquired star, technical
analyst to sit with him during the trading day and teach him technical
trading. Getting the opportunity to show off his abilities to such an
experience and successful trader was something analyst was more than
happy to do.
The analyst was using a technical methodology called "Point and
Line" to determine his support and resistance levels. On one of the days
they were watching the Soybean market together, it happened to be
trading in a range in between what the analyst projected as support and
resistance.
As the analyst was explaining to the chairman the significance of
these two points, he stated in very emphatic, almost absolute terms that if
the market goes up to resistance it will stop and reverse and if the
market goes down to support it will also stop and reverse. But, he added
that if the market went down to the price level he calculated as support,
then his calculations indicated this would also be the low of the day.
As they sat there, the soybean market was slowly trending down
to the price the analyst said would be the low of the day. When it
finally got there, the chairman looked over to the analyst and said,
"This is where the market is supposed to stop and go higher right?" The
analyst responded, "Absolutely! This is the low of the day." That's
bullshit!" the chairman retorted, "Watch this." He then picked up the
phone and called one of his clerks handling orders for the soybean pit
and said, "Sell two million beans (bushels) at the market." Within thirty
seconds of placing the order the soybean market dropped ten cents a
bushel.
The chairman turned to look at the horrified expression on the
analyst's face and said, "Now where did you say the market was going to
stop? If I can do that, anyone can."
8. I wouldn't put a trade on if I wasn't sure it was going to be a
winner.
The answer that is consistent with a traders "mind set" is disagree.
The answer to this question has enormous implications in your
ability to create consistent results. If you're not putting on a trade until
you've convinced yourself it's a winner, are you taking any risk? No
you're not. At least you don't think you are. Because, on the other hand, if
you really believed that every trade had a probable outcome, you
would never be sure that any trade was a winner. If you really believed
that you could never be sure that any trade was a winner, would you still
trade?
To create consistent results, you can't do anything to try and avoid
the risks of trading. Convincing yourself a trade is a winner is avoiding
the risk. No legal trade has a guaranteed outcome. When you truly accept
the risks of trading, then you will be more than willing to gather
evidence for why any particular edge may not work and put the trade on
anyway, as long as, that risk is within financial and emotional parameters
you can tolerate.
When you know in advance what the market has to do to tell you
your edge isn't working, you won't find yourself caught in huge losing
trades that inflict a great deal of both financial and emotional damage.
Because once you've created the damage, it makes learning how to trade a
lot more difficult than it already is.
9. I always define my risk before I enter a trade.
The answer that is consistent with a traders' "mind-set" is agree.
If you don't define your risk before you enter a trade, you are
trading from the perspective that you what is going to happen next.
Obviously, the only way you could know for sure what was going to
happen next is if you were able to read the minds of everyone
participating in the market, as well as, those who have the potential to
participate. It only takes one trader somewhere in the world to negate
the positive outcome of your trade. If you believed this you would never
allow yourself to get into a trade without determining in advance what
the market had to do or look like to tell you this trade is not working.
10. The more a trader learns about the nature of the markets the
easier it will be for him to execute his trades.
The answer that is consistent with a trader's "mind-set" is disagree.
If you haven't learned to think in probabilities, you will find this
statement couldn't be further from the truth.
A strong sense of confidence, meaning a distinct lack of fear, is
the only thing that will help you execute your trades properly. Fear is
immobilizing and it causes us to hesitate and second-guess ourselves. As
traders, what we are most afraid of is being wrong and losing
money. If you're learning more about the market as a way to avoid
being wrong and losing, it's not going to work. In fact, you'll find it will
have the opposite effect.
Consider that the more you learn about the markets or the better
your analysis is, the more you will naturally expect to be right. Or
more importantly, the more you will expect not to be wrong. The more
you expect not to be wrong, the more pain you will experience when
you are. The greater the potential for pain, the greater the potential to
distort market information to avoid that pain. To whatever degree you
distort market information is the same degree to which you will not be
able to perceive what the market is making available in the way of
opportunity, from it's perspective.
In essence, you will create a situation where you will actually
make yourself wrong. In other words, by trying to avoid the risk of
being wrong or losing money through better market analysis, you will
create the very experience you are trying to avoid. Ultimately, you will
intensify your fears of being wrong and losing money - making it more
difficult to execute your trades.
11. Sometimes I find myself blaming the market for what went
wrong.
The answer that is consistent with a traders "mind-set" is disagree.
If you agreed with this statement, take a moment and consider
your perspective. Everyone who trades, does so for the very same
reason. There are only two outcomes to every trade - it's either a
winner or a loser. No one wants to be on the losing end of a trade, at
least not consciously.
For you to blame the market for what went wrong, it means that
you felt betrayed in some way. And if you felt betrayed, it means that
you expected the market to do something for you. Now, I want you to
ask yourself, when was the last time you got up in the morning and
thought to yourself, "What can I do today to fulfill some other trader's
expectations or dreams of financial independence?"
Sounds absurd doesn't it? And yet when you blame the market,
that is exactly the stance you are taking. Instead of keeping your mind
objectively focused in the now moment opportunity flow, and
executing your trades to cut your losses or book your profits, you were
expecting the market to go on forever if you were in a winning trade or
come back if you were in a losing trade. In other words, you were
expecting the market to do it for you or you wouldn't have a reason to
blame the market.
The unfortunate part about trading is sometimes the market will
do it for you. I say unfortunate, because if you rely on the market to do
anything for you, at some point you'll get spanked. This is a trading
truism you could mortgage the house on.
12. Technical indicators work because the collective actions of
traders who participate in any given market create quantifiable
behavior patterns that repeat themselves with statistical
reliability.
The answer that is consistent with a trader "mind-set" is agree.
I have no way of knowing what you believe about the nature of
price movement or what technical indicators do. However, like many
people, maybe your believe that fundamentals move the market. If this is
the case, consider that people who trade may have any number of
reasons for doing so. Everyone's actions have an impact on price
movement. If the reasons you use to justify getting into or out of a trade
are based on the best fundamental information and analysis available, it
doesn't necessarily mean that a significant number of other traders have
access to the same criteria for making a decision, or would even agree with
you if they did.
For the price of any traded security of financial instrument to
move in the direction of your position requires other people who share
similar beliefs about what is high or what is low. Unless of course, you
personally can trade at a level large enough to move the market
yourself.
Regardless of how you make your trading decision - technical,
fundamental or otherwise, you'll save yourself from a lot of emotional
discomfort. if you always keep in mind the following:
As long as you can't get into the mind of each individual trader who has
the potential to act as a force on prices, then every trade you enter into, or
exit, regardless of whatever reasons or justifications you have for doing
so, will always be based on nothing more than an "edge "-u-cated guess.
13. To be a successful "technical" trader you have to determine what the
market is going to do next.
The answer that is consistent with a traders "mind-set" is
disagree.
To be a successful technical trader you need: a.) a good edge, b.) to
keep your mind objectively focused in the "now moment"
opportunity flow, c.) execute your trades properly and d.) have a
specific plan for taking profits. None of these steps require a prediction of
market direction.
